RBI has announced a two-day Variable Rate Repo auction of Rs 50,000 crore that will help manage short-term liquidity conditions as the RBI is reviewing Monetary policy. This auction was done at 10 am on 3rd June, while the fund reversal may take place on 5 June.
As the surplus liquidity has moderated in the last few years in the banking system. System liquidity till June is Rs 85,411.44 crore. RBI banks' latest liquidity operation showcases muted demand from banks. In this auction, RBI received bids of Rs 17,445 crore against the Rs 75,000 crore notified amount. The central bank has accepted the entire amount and injected it into the banking system at a rate of 5.26 percent. Monetary Policy Committee started its three-day meeting and will announce the policy decisions on 5th June.
|